TL;DR
- Understanding betting odds is crucial for success in sports wagering on events like the World Cup or NFL.
- Odds determine win probabilities and potential payouts, guiding decisions on when to bet or cash out.
- Odds are shown in fractional, decimal, and American formats, each with unique calculation methods.
- The house edge is the sportsbook's built-in advantage, while vigorish is the fee charged for taking a bet.
With the rise in popularity of sports betting, it's crucial to grasp what you're wagering on, your betting partners, and importantly, the meaning and variations of betting odds.
Understanding how betting odds function is crucial for success, whether you're wagering on Premier League, Ryder Cup, World Cup, or NFL.
Figuring out how to read odds is crucial for those who want to actively engage in online sports betting, as they determine probabilities of wins and overall potential payouts.
At AllSportsPeople, we'll break it down and clarify the pressing question: precisely how do betting odds function?
Understanding sports betting odds
Seeking sports betting lines to bet on? Grasping how to interpret sports betting odds is crucial for identifying the most advantageous wagers, though nowadays, online sportsbooks frequently handle the heavy lifting for you.
You can add a selection to your betslip and enter your desired stake, which will then automatically compute the potential returns according to the odds. This functionality applies to single wagers, accumulators, or bet builders, for instance.
Understanding odds empowers you to maximize value and achieve superior returns from the bookmaker, guiding decisions on when to cash out or even refrain from betting due to significant market fluctuations.
Odds are typically shown in three primary formats, and although fractional odds are prevalent in the U.K., grasping how each functions and converts is vital, as certain widely used betting applications and platforms, including betting exchanges, may display their odds differently to cater to their specific user demographics.
Below, we've examined the advantages, disadvantages, initial sign-up incentives, and continuous deals from several prominent UK bookmakers.
How to read fractional odds
In the U.K., fractional odds are the most prevalent form, represented as a ratio like 5/1, which is read as "five to one."
To clarify, this signifies that for each £1 wagered, a £5 profit is attainable. Consequently, a £10 wager on a 5/1 selection that wins would result in a £60 payout, which includes your initial £10 stake.
MORE: Read our expert guide to betting on football
How to read decimal odds
Decimal odds betting is also used in the U.K., including with betting exchanges such as Matchbook and the Betfair Exchange — but it's also in Europe too. Decimal odds represent the total payout of your bet, rather than just the pure profit.
That means odds of 3.5 mean that for every £1 you bet, total return would be £3.50, including your initial stake. A £10 bet at 3.5 decimal odds would return a total of £35.
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How to read American odds
American odds, also called moneyline odds, are prevalent in the USA and are shown as a positive or negative figure.
The team or individual favored to win will be indicated by a minus sign (-). The larger the absolute value of this number, the greater the probability that traders believe the selection will be victorious. For instance, a favorite listed at -200 is considered more likely to win than one at -120.
When betting on an underdog, you'll see a plus symbol (+). A larger number indicates a greater underdog status. For example, a +200 underdog is considered more likely to win than a +500 long shot.
If a bet is listed as a -135 favorite, it signifies that you'd need to bet £135 to secure a £100 profit from the bookmaker. Conversely, a +350 outsider indicates that a £100 wager could yield a £350 return, with £100 of that amount representing your initial stake.
What is the house advantage and the commission?
You might be wondering, "What exactly is the 'house edge'?" The house edge is both a term and a mathematical calculation that sportsbooks and casinos employ in every game or market. This built-in advantage ensures that, regardless of short-term outcomes, they consistently profit over time.
Understanding the significance of the house edge will help you place your bets wisely, as it can differ for each bet you make. The larger the house edge, the more likely the sportsbook is to win over a long period of time.
The house edge signifies the casino's built-in advantage in a game, while RTP (Return to Player) represents the percentage of wagered money a game is expected to pay back to players over time.
Bettors might easily confuse the house edge with the term "Return to Player" (RTP), though they represent opposing ideas. Here's how to distinguish between them:
- House Edge: The percentage of each bet that the sportsbook keeps to itself.
- RTP: The percentage of the total wagers that are returned to players as winnings over time.
If a game features a 5% house edge, its RTP would be 95%. While the house edge benefits casinos or sportsbooks, RTP benefits players. These two metrics are inversely connected, so an increase in one leads to a decrease in the other.
What about the vigorish? The vig, or vigorish, has only recently become common in UK conversation, originating from the USA as people there attempt to calculate the 'vig' on their parlays, which we UK bettors call accumulators.
It’s essentially the cut or amount the sports betting sites charge for taking a bet, often known as the 'juice' in slang terms.
An online bookmaker only takes the vig if you lose the wager.
Bet payout calculation
Numerous online betting odds calculators exist to transform decimal odds into fractional or moneyline formats, enhancing clarity and conciseness. Paddy Power are among the major firms who also offer a free odds calculator online.
Odds come in several forms, all representing probabilities in different ways. Bookmakers frequently employ one format, which can be readily converted to others, aiding comprehension of sports betting odds.
After the implied probability for a particular outcome is determined, frequently shown as a percentage, bettors can then decide for themselves whether to place the bet at their preferred odds format.